Government pounds home fraud case

Trial dealing with alleged orphanage investment scheme may head to jury by Friday.

Trial dealing with alleged orphanage investment scheme may head to jury by Friday.

April 15, 2006|PATRICK M. O'CONNELL Tribune Staff Writer

SOUTH BEND -- The second week in the federal trial of a family indicted in a massive investment fraud scheme wrapped up Thursday with testimony from another government witness who said he lost thousands of dollars in the alleged scam. Jury members receive a four-day Easter weekend break from the tedious presentation of numbers-heavy evidence and testimony before the trial of Rodger D. Griggs and his wife, brother and son-in-law reconvenes Tuesday morning in U.S. District Court in South Bend. The government, which has called dozens of witnesses and presented mounds of financial documents, letters, bank wire transfers and real estate records as evidence, is expected to wrap up its case by mid-week. Defense counsel informed U.S. District Judge Allen Sharp it expects to take one or two days to present its arguments, meaning the case could be turned over to the jury by Friday. A 42-count federal indictment charges Griggs with conspiracy, tax evasion, wire fraud and money laundering for wooing investors to a bogus program he claimed would turn expansive northern Indiana ranches into orphanages for American Indian children. Instead, Griggs used investors' money to buy fancy houses and to line his family's own coffers, the government contends. Griggs falsely claimed he was an American Indian tribal chief, a former rock star drummer and an acquaintance of golfer Jack Nicklaus in order to attract investors, according to the indictment. Griggs also promised hefty returns, saying he was able to tap into secret government funding mechanisms designed to help American Indians, government witnesses testified. Griggs' wife, Julie, and son-in-law, Shawn H. Shroyer, also are charged with several counts of wire fraud and conspiracy. Griggs' brother, Donald, is charged with one count of conspiracy. Witnesses have testified they made no profit and lost the initial principal that was supposed to be insured and only to be used as collateral to launch the program. Leon Stankovich testified Thursday he lost about $15,000 in the scheme after he invested $50,000 with Rodger Griggs. "From what they told me, I was going to be a millionaire before long," Stankovich said. "Are you a millionaire?" asked Assistant U.S. Attorney William T. Grimmer. "No," Stankovich answered. When asked by Rodger Griggs' lawyer, Brian J. May, if he really expected to earn millions on his investment, Stankovich chuckled sheepishly. "Kinda dumb, isn't it?" Stankovich testified. "But they convinced me."